House, Senate to Vote on FY 2016 Budget Resolutions
Last week, both the House and Senate Budget Committees approved their respective FY 2016 Budget Resolutions. On the House side, Republicans are using their FY 2016 Budget Resolution to push for comprehensive tax reform that reduces individual and corporate tax rates and eliminates the alternative minimum tax. The plan would also close certain “loopholes” and move away from the current worldwide system of taxation. Additionally, the House Budget Resolution includes reconciliation instructions and uses a baseline that assumes expired tax extenders will remain expired.
In the Senate, the Budget Resolution would set up a series of budget-neutral reserve funds, allowing for tax reform, infrastructure spending, and education, among other issues. As part of the tax reform reserve fund, the Budget Resolution provides for various items, including comprehensive tax reform, renewing expired tax extenders, and repealing the medical device tax. While the Senate Budget Resolution contains reconciliation instructions, it does not provide such instructions with respect to tax reform, as Senate Finance Committee Chairman Orrin Hatch (R-UT) has expressed his preference not to use reconciliation for tax reform. During the markup, the Senate Budget Committee adopted several amendments to the Budget Resolution, including Democratic provisions requiring: (1) tax expenditure calculations to be added to Budget Resolution calculations; (2) an additional supplemental estimate that evaluates the distribution effect of revenue changes across income categories; and (3) the Internal Revenue Service (IRS) to inform tax payers if they are aware that the taxpayer’s identity has been stolen. The House Budget Resolution, however, remained unchanged by Democratic amendments. Additionally, both Budget Resolutions would balance the budget within 10 years.
This week, the full House and Senate will consider their respective Budget Resolutions on the floor and likely seek to add amendments through a process called “vote-o-rama,” before Congress’ two-week recess begins. While Democrats are not expected to introduce an alternative Budget Resolution, they are preparing a list of amendments, including provisions likely related to issues such as ending “too big to fail,” ending sequestration, investing in job creation, and increasing the minimum wage.
Ways and Means Committee to Mark-Up Legislation
On Wednesday, March 25, the House Ways and Means Committee will hold a markup of various pieces of legislation, including a bill to repeal the estate tax. It is expected that Senator John Thune (R-SD) will introduce similar legislation in the Senate this week. The full list of legislation the Committee will consider includes:
- H.R. 1105, the Death Tax Repeal Act of 2015;
- H.R. 1058, the Taxpayer Bill of Rights Act of 2015;
- H.R. 1152, to prohibit officers and employees of the Internal Revenue Service from using internal personal e-mail accounts to conduct official business;
- H.R. 1026, the Taxpayer Knowledge of IRS Investigations Act;
- H.R. 1314, to amend the Internal Revenue Code of 1986 to provide for a right to an administrative appeal relating to adverse determination of tax-exempt status of certain organizations;
- H.R. 1295, to amend the Internal Revenue Code of 1986 to improve the process for making determinations with respect to whether organizations are exempt from taxation under section 501(c)(4) of such Code;
- H.R 709, the Prevent Targeting at the IRS Act; and
- H.R. 1104, the Fair Treatment for All Donations Act
This Week’s Hearings:
- Wednesday, March 25: The House Ways and Means Committee will hold a markup of various tax bills.